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ISEC buys raw sugar at $244/t

Harish Damodaran

New Delhi , Feb. 18

INDIAN Sugar Exim Corporation Ltd (ISEC) has managed to contract two large raw sugar import consignments aggregating about 1,07,750 tonnes on behalf of northern mills at $243-244 per tonne (Mundra port delivery), which is $13-14 per tonne below the going rate.

According to an ISEC official, the first Panamax vessel carrying 60,000 tonnes, is expected to arrive at Mundra around March 6, which will be followed by a Handymax cargo of 47,750 tonnes a couple of days later.

"We have chosen the Mundra port because it has a draft of 16 meters, which makes it possible for large vessels to call directly at the berth. The Kandla port, on the other hand, has a lesser draft of about 11.2 meters, which requires lighterage operations, involving anchoring the vessel at mid-sea, from where the cargo has to be offloaded to smaller vessels. This exercise entails additional costs," the official said.

The official added that by importing in bulk and taking delivery at Mundra (thereby saving on lighterage), while simultaneously achieving a discharge rate of over 10,000 tonnes per day, "we have been able to contract imports at $13-14 per tonne below the prevailing rate along with six months credit".

He claimed that even in an earlier consignment of 46,000 tonnes that was discharged only last week at Kandla, "we had managed to achieve a single day's discharge of 12,600 tonnes (a record for any commodity), resulting in dispatch money savings of $1,17,000".

During the 2002-03 and 2003-04 sugar seasons (October-September), raw sugar imports into the country amounted to 1.24 lakh tonnes (lt) and 5.53 lt, respectively. This entire quantity was brought in by South-based mills, barring about 50,000 tonnes by Dhampur Sugar. But in the current season, a host of northern mills, besides Dhampur, have joined the bandwagon.

Dhampur alone has imported two lt this season, with other large northern importers being Simbhaoli Sugar (74,000 tonnes), Triveni Engineering (15,000 tonnes), Mawana Sugars (13,000 tonnes), Oudh Sugar (10,000 tonnes), KM Sugar (10,000 tonnes) and Daurala Sugar (9,000 tonnes).

Total imports during the 2004-05 season are expected to be around 20 lt, which, along with estimated domestic production of 120-125 lt, will stabilise domestic supplies, obviating the need for any white sugar imports, the ISEC official said.

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